< NEWS

May 15, 2018

GERONIMO BLOG: Protect Your Organization Against Electric Cost Increases with a Virtual Power Purchase Agreement (VPPA)

We know that corporate sustainability goals benefit the environment by supporting projects that improve the Earth’s air and water quality – sustainability makes social sense. But many companies are now discovering that investing in renewable energy also makes financial sense.

Virtual Power Purchase Agreements (VPPA) for renewable energy projects offer protection against rising future electric prices. They also offer predictable electricity budgets and may even present a profit based on the net present value of the contract.

How Does a VPPA Protect a Company Against Future Electric Cost Increase?

Affordability – With current tax incentives set to expire in coming years, the time has never been better to invest in renewable energy. Companies that take advantage of the reduced prices offered as a result of the Production Tax Credit (PTC) and the Investment Tax Credit (ITC) now stand to gain affordable, long-term clean energy in the future. Plus, thanks to technology advancements, both wind and solar energy prices have decreased significantly in recent years, making renewable energy VPPAs even more affordable.

Predictability – With a VPPA, the buyer and seller agree to a fixed market price (strike price) for the power produced by the contracted project. Over the life of the VPPA, as wholesale energy market prices change, settlements are paid out based on the fixed price to either the buyer or the seller. This VPPA hedge, in turn, stabilizes the net price for the company over the life of the  agreement, allowing for increased predictability and decreased volatility.

Profitability – With a VPPA, there is no upfront investment. Best of all, most companies find that the net present value (NPV) of their contract savings actually offers a profit in the here and now.

VPPAs offer buyers the benefits of affordability, predictability and profitability. Sustainability and renewable energy contracts are no longer just mechanisms for social change and environmental stewardship. Clean energy projects and VPPAs are methods for companies to save money, cut costs, and plan for the future.

Learn more about Geronimo Energy and our projects.


CONNECT

Stay In "The Know"

Keep up to date with industry
news and information by
signing up for our corporate
communications. It's FREE.

SIGN UP

Questions?

Please contact us anytime!

CONTACT US

EVENTS

February 5-7

Midwest Renewable Energy

Chicago, IL

Come join us and the rest of the Midwest renewable energy community in Chicago at Midwest Renewable Energy! We will be exploring how changing economics and the coming PTC expiration with affect wind and solar.

February 25-26

ESA Energy Storage Annual Conference & Expo

Phoenix, AZ

Meet us at the ESA Energy Storage Annual Conference & Expo as we learn about expansion, inclusion and integration within the energy storage industry. Let’s dive into how we can help drive new technologies for storage.

.

February 25-27

Michigan EIBC 7th Annual Member Meeting

East Lansing, MI

The Michigan EIBC 7th Annual Member Meeting will be a day jam packed with information on the latest policy developments and innovations in advanced energy. Geronimo Energy will be joined with Michigan’s advanced energy industry, utility executives, policy makers and regulators.

OTHER UPCOMING EVENTS
952-988-9000
info@geronimoenergy.com